You can let users play around with your paid app to see if it works as expected. Certainly cleaner than messing with In-App-Purchases or a separate "Lite" version of your app.

I've heard in one episode of the Core Intuition podcast that Panic has actually spent some time polishing a simulator build of Transmit(?) for iOS, for use with app.io (a service which did the same thing as the OP until they pivoted). This is something I'd also love to do if this business promises to survive longer than app.io did.

This is especially interesting if you are an iOS freelancer who wants to show off their work, without clients having to create accounts etc. :)

That was my initial reaction as an iOS developer would have access to Simulators via Xcode.

That said, I could see this as a tool for sharing to a client for demo purposes.